By Grant Williams

Washington

A Tennessee charity that raises money through the Combined Federal Campaign — the annual drive for federal workers — is suing in federal court for the right to solicit donations through the campaign after the government denied its admission.

The organization, the Stuttering Foundation of America, in Memphis, was rejected for the fall 2007 drive because federal officials said that it did not qualify under a new rule, adopted by the government last year, that participating groups must be “public charities,” which the federal tax code defines as organizations with broad financial support from the public.

The Stuttering Foundation of America is classified under tax law not as a public charity but as a private operating foundation. Such foundations are endowed groups that use most of their resources to directly operate their own charitable programs; don’t make any (or many) grants to other organizations; and usually don’t raise much (if any) money from the public. By contrast, more-common private foundations do not provide direct services themselves and make grants to other organizations.

The Stuttering Foundation of America was established in 1947; it provides information and assistance to prevent stuttering in young children and and provides treatment for teenagers and adults who stutter.

The organization has qualified for — and participated in — the Combined Federal Campaign from 1992 to 2006, receiving more than $30,000 in pledges in each of the past two years.

Last November, the U.S. Office of Personnel Management, which oversees the Combined Federal Campaign, made several changes in how the campaign operates, including revising a rule to say that participating national charities must be public charities, “not private foundations or exclusively government units or instrumentalities thereof.”

At the time, the Office of Personnel Management said no one had objected to the idea of clarifying this rule during a months-long comment period that had just expired.

In a legal filing last week in U.S. District Court for the District of Columbia, the Stuttering Foundation of America said that the Office of Personnel Management in March turned down its application for participation in the fall 2007 campaign because the foundation is not a public charity. The foundation said the government in March also declined to grant a “one-year waiver” of the requirement to the Stuttering Foundation of America and other operating foundations.

In its lawsuit, the Stuttering Foundation of America charged that the government’s change in rules violates a 1987 federal law that says the criteria for the eligibility of organizations that may participate in the Combined Federal Campaign cannot be different from the eligibility criteria that existed in the 1984 regulations for the charity drive. The 1984 regulations allowed private operating foundations to participate in the drive, according to the Tennessee group.

The Stutttering Foundation of America asked the federal court to force the Office of Personnel Management to allow the organization to participate in the 2007 Combined Federal Campaign.